Ports Turn to Natural Gas in Quest for Cleaner Marine Fuel

The tightening of emissions limits for deep-water ships has some of North America’s busiest ports chasing a new opportunity.

The UN’s International Maritime Organization last year cut limits on sulfur in marine fuels to 0.5 percent from 3.5 percent, starting in 2020. The target: So-called bunker fuel, a cheap, tar-like oil residue used by most ships. Now ports in Vancouver, Los Angeles and Tacoma are all studying whether they can profit from supplying liquefied natural gas, which emits virtually no sulfur, as a cleaner alternative fuel that’s almost as cheap.

While the use of more expensive fuel oil or bolt-on scrubbers can help existing ships slip under the limit, LNG is the fuel of the future for new vessels, according to Norway-based DNV GL, which certifies ships for safety. Exxon Mobil Corp.’s 2016 energy outlook sees use of LNG growing to 10 percent of marine fuels by 2040 from 1 percent in 2016.

“It’s something that we want to be at the leading edge of,” said Robin Silvester, chief executive officer of Vancouver’s port authority, which is set to issue a study shortly on the potential market. “That will be the next way that marine emissions can be significantly reduced.”

High concentration of sulfur contributes to so-called acid rain, haze and air particulate pollution that can penetrate deep into human lungs and pass into the bloodstream.

About 97 ships worldwide are now powered by LNG with an additional 91 on order, according to DNV GL. By 2020, the number may rise to around 250, excluding LNG carriers and inland waterway vessels, DNV reports.